MidSouth Week in Review
February 19, 2021

Weekly Update from Fund Manager Buzz Heidtke, MidSouth Investment Fund

All the major stock indexes hit new highs for the week.  The S&P declined 0.7%.  The Russell 2000 small cap index was down 1.1% and is up 15.9% for the year.  Oil hits pandemic high as winter storm pushes demand and poses production risk.  Bitcoin surged to 55,000 from last weeks 47,000 low.  Gold hit a 7-month low in declining to 1760.  Lumber made an all-time high in rising above $1,000 vs. its October low of $481.  Copper, which is an indirect play on electric cars, made a 10-year high in pushing through $4 today.  Goldman Sachs warns of a historic shortage of the metal as it explodes higher.  Retail sales increased 5.3% last month, beating economist’s expectations and marking their first increase since September.  Sources: Wall Street Journal and New York Times

BuzzBits

Easy Money – The people who have gotten rich quickly are also the ones who get poor quickly – Sir John Templeton

Two Things – to make your day better:  Do not watch the news and stay off the bathroom scales –

Financial Crisis – Close to 40% of U.S. households would not be able to weather a financial crisis and 14% live paycheck to paycheck with a high debt load and no emergency savings – FSI News Brief

Tom Brady – The former Michigan quarterback was the 7^th QB picked in the 1999 NFL draft with 3 of the 6 never playing an NFL playoff game.  Of the 10 Super Bowls Brady played in, he has won seven of them – Pro Football Reference

Small Banks – are more vulnerable to the risk of a commercial real estate (CRE) tenants crisis vs. larger banks because a larger portion of their loans are in the category.  Outside of hotels, distressed sales aren’t abnormally high to date.  However more sales loom as banks and owners unload vacant assets.  As of now, 75% of companies plan to use less office space in the future – Fortune

The Vaccine Shot – Nationwide, nearly half of Americans would refuse a shot if offered one immediately, polls suggest.  The evidence so far suggests that a full dose of the vaccine, with the appropriate waiting period after the second shot, effectively eliminates the rise of Covid-19 death, nearly eliminates the risk of hospitalization and drastically reduces a person’s ability to infect somebody else.  All of that is also true about the virus’s new variants – New York Times

Strange Numbers – U. S. deaths rose 20,707 in 2018 vs. 2017, 16,300 in 2019 vs. 2018 and 57,641 in 2020 vs. 2019, which included 440,000+ coronavirus deaths.  Strange! – CDC

Oil and Gas – “I think there’s a tremendous pen-up demand from consumers.  Workers want to get back to their offices.  Oil and gas is going to come back with a vengeance.  Already in Brazil, petroleum demand is above the coronavirus levels”. - Billionaire John Goff ….. This week, crude rose to a 13-month high of $61, from a November low of $35 – Buzz

Golf – Rounds played in the U.S. fell by 8.5% last March and by 42% in April as more than half the nation’s golf courses closed.  By September, rounds played were 37% higher and up strongly for the entire year – Wall Street Journal ….. In 1996, Nashvillian Buzz Davis shot a hole-in-one at Augusta.  Only problem, he was playing with three lawyers, so nobody believed him ….. Tennis has boomed during the pandemic with an estimated 21.6 million Americans picking up a racket in 2020, up 22.4% after several years of stagnant participation – USA TODAY

China – For every $1 of goods that U.S. companies sold to Chinese buyers, American consumers bought $3.49 of goods from Chinese manufacturers – Department of Commerce

College Costs – Nearly all selective schools consider grades as a factor not just for admission but also in “what you might pay.”  In Georgia, a 3.0 grade point average can lead to thousands of dollars per year off the price – New York Times

Privatize The Post Office – In January I got a Christmas card from Colorado that took 14 days to receive.  Two weeks ago I mailed a Valentines card to the grands in Boston that took eight days.  This week, because of light snow in Nashville, we received no mail in the office.  Maybe it’s time to privatize the mail service to companies such as FedEx, UPS or Amazon – Buzz

Sign – at a Knoxville gas station “Vols bumper stickers removed here” – Tom Fitzpatrick

Life Expectancy – in the U.S. fell by a full year in early 2020, the largest drop since WWII and a sign of the pandemic’s toll.  The steepest decline was among black men – New York Times

Automobile History Quiz - attachment

This material does not necessarily represent the views of the presenting party, nor their affiliates.  This information has been derived from sources believed to be accurate.  Please note – investing involves risk, and past performance is no guarantee of future results.  The publisher is not engaged in rendering legal, accounting or other professional services.  If assistance is needed, the reader is advised to engage the services of a competent professional.  This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty.  This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such.  This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested.  All economic and performance data is historical and not indicative of future results.  Market indices discussed are unmanaged.  Investors cannot invest in unmanaged indices.